# Replication package for "Making Bribery Profitable Again? The Market Effects of Halting Extraterritorial Accountability for Overseas Bribery"
## Lorenzo Crippa, Edmund J. Malesky, and Lucio Picci
### _International Organization_, 2025

This file contains instructions on how to execute the code contained in the replication package and replicate the results contained in the main text and Online Appendix of the paper. For any query, please do not hesitate to reach out to the software curator, Lorenzo Crippa ([crippa.lnz@gmail.com](mailto:crippa.lnz@gmail.com)).

# Software specifications

The replication package folder contains an Rproject file called `CMP_IO_2025_replication.Rproj`. Users can run all codes by simply opening this project in RStudio. That way, they do not have to set working directories manually.

The replication package runs entirely in R. All scripts have been executed on R version 4.4.2 (2024-10-31), on a MacBook Air M3 2024 (Platform aarch64-apple-darwin20), running under macOS Sequoia 15.6.1.

Several R packages are necessary in order to fully execute the code and generate all outputs. Full details on the packages necessary, as well as their versions, are reported in the file `sessionInfo.txt` which sits in the main directory. **WARNING**: in order to ensure the code runs smoothly, the user should ensure packages run on the versions specified in `sessionInfo.txt`.

# Appendix and codebook

The replication package folder contains two PDFs: `CMP_IO_2025_appendix.pdf` (which reports the full Online Appendix) and `CMP_IO_2025_codebook.pdf` (which reports the codebook and details all variables contained in all data files used).

# Folder description

The replication package folder contains the following subfolders:

- `aux`: contains auxiliary code that serve the estimation or event windows. These scripts are sourced by the scripts in `code` and should not be executed on their own

	- `aux/estimation_function.R` wraps the `estimation_window` function that is used in the first phase of the analysis (estimation window).

	- `aux/event_function.R` wraps the `return_daily_avg` function that is used in the second phase of the analysis (event window).

	- `aux/plot_theme.R` wraps the code that sets a default theme for all plots.

- `code`: contains all scripts necessary to run the analysis. Scripts should be run in the order in which they are numbered. Scripts number 01, 02, and 03 perform the data cleaning, estimation window, and analysis for the main text. Scripts numbered 04--17 replicate one appendix section each. They are named with their corresponding appendix section name. 

	- `code/01_data_prep.R` prepares the stock data for the estimation window. It also uses several matching techniques to generate suitable placebo samples  

	- `code/02_estimation_window.R` sources stock market data and runs the estimation window phase. 

	- `code/03_main_text.R` replicates all results reported in the main text.

	- `code/04_appendix_A.R`, `code/05_appendix_B.R`, ... `code/17_appendix_O.R` replicate all results reported in each of the appendices. Each script is named with the corresponding appendix section and numbered sequentially.

- `data`: contains all data files that are inputs of the included scripts.
	
	- `data/covars_compustat.rds` contains firm-level covariates from Compustat that are used to generate the matched placebo samples.
	
	- `data/FCPA.rds` contains information on FCPA enforcement against 286 publicly traded companies from Stanford's FCPA Clearinghouse.
	
	- `data/FCPA_enf.rds` contains information on FCPA enforcement against 462 publicly traded and private companies from Stanford's FCPA Clearinghouse.
	
	- `data/OECD_ABC_enf.rds` contains information on enforcement under the OECD Anti-Bribery Convention (ABC) from Crippa, Malesky, and Picci (2025).
	
	- `data/reprisk_cs.rds` contains cross-sectional information on the RepRisk Index (RRI) of 311 firms (past FCPA targets and matched placebos) on December 31, 2023.
	
	- `data/reprisk_pd.rds` contains panel data information on the RepRisk Index (RRI) of 231 firms (past FCPA targets and matched placebos) from January 01, 2007 to December 31, 2023.

	- `data/SP500_index.rds` contains daily observations for the S&P 500 composite index, downloaded from Yahoo! Finance R API.

	- `data/SPindex_const.rds` contains the list of individual constituents of the S&P 500 composite index. Downloaded from Compustat.

	- `data/stocks_compustat.rds` contains daily stock market trading observations for all Compustat firms, in the period of interest. Downlaoded from Compustat.

	- `data/WRDS_subsidiary.rds` contains subsidiary information (as of 2022) provided by Wharton Research Data Services (WRDS) from firms' SEC filings.

- `data_out`: contains all data files that are outputs of the scripts. 

	- `data_out/placeholder.txt` is an empty file that allows the folder to be generated when downloading the replication package.

- `estim`: stores the results of the estimation window phase (produced in `code/02_estimation_window.R`)
	
	- `estim/placeholder.txt` is an empty file that allows the folder to be generated when downloading the replication package.

- `plots`: stores the plots generated by `code/03_main_text.R` and appendix scripts (`code/04_appendix_A.R`, `code/05_appendix_B.R`, ..., `code/17_appendix_O.R`)
	
	- `plots/placeholder.txt` is an empty file that allows the folder to be generated when downloading the replication package.

- `tables`: stores the tables generated by appendix scripts (`code/04_appendix_A.R`, `code/05_appendix_B.R`, ..., `code/17_appendix_O.R`)
	
	- `estim/placeholder.txt` is an empty file that allows the folder to be generated when downloading the replication package

